Leggett & Platt quarterly profit falls 50%

Carthage-based Leggett & Platt on Thursday reported third- quarter profit down 50 percent from a year ago, despite improvements in quarterly sales.

Earnings per share for the quarter were 20 cents, which takes into account 14 cents per share in charges from nonrecurring items. Excluding those charges, earnings were 34 cents per share, compared to 36 cents per share a year ago.

Net income was $37.4 million, down 50 percent from $65.7 million in the same quarter last year. Year-to-date net income was $122.4 million, a 39 percent decrease from $201.4 million a year ago.

Sales from continuing operations totaled $1.3 billion, a 3.7 percent increase from third-quarter 2007. Same location sales improved 4.3 percent.

"The markets we serve weakened appreciably toward the quarter's end, as consumers rein in spending during this unprecedented period of tight credit and high stock market volatility," Leggett President and CEO David S. Haffner said in a news release. "On the other hand, we continue to successfully pass along higher raw material costs, and to gain market share as bedding manufacturers reduce their use of imported innerspring components."

Four business units were divested, resulting in after-cash proceeds of $388 million, and three other divestitures are under way. The discontinued operations accounted for 9 cents of the 14 cents in nonrecurring charges. Leggett announced in November 2007 that it would eliminate seven business units in order to improve shareholder returns.

Also during the quarter, the company decided to narrow its Stores Fixtures production unit to focus on only metal fixtures, as the division has not met return requirements, the release said. The change will eliminate production facilities, affect senior management, reduce unit overhead, purge customer accounts with unacceptable margins and trim annual trade sales to between $250 million and $275 million.

Leggett shares (NYSE: LEG) closed Thursday at $18.57 and were trading down at $16.10 as of 10:45 a.m. The 52-week range is $14.12 to $24.60.[[In-content Ad]]